Group claims racial disparity in bank’s treatment of properties
A nonprofit fair-housing group alleged Tuesday that a nationwide lender’s policies in dealing with foreclosed properties have contributed to blighted housing in black and other nonwhite neighborhoods in Louisiana’s capital city.
Officials of the Greater New Orleans Fair Housing Action Center formally joined a complaint filed against U.S. Bank, of Minneapolis, last year by the National Fair Housing Alliance.
The nonprofit’s addition to the complaint was made on behalf of Baton Rouge residents.
That complaint filed with the U.S. Department of Housing and Urban Development alleges U.S. Bank maintains and markets foreclosed properties better in white neighborhoods than in nonwhite neighborhoods of 24 cities.
It asks HUD to ensure equal treatment of both groups.
In Baton Rouge this summer, “It became very clear that there was a trend, and this trend was one of racial disparity,” said James Perry, executive director of the New Orleans nonprofit.
Perry said the nonprofit’s staff visited 26 of U.S. Bank’s Baton Rouge properties to reach that conclusion.
Fifteen of the properties were in majority African-American neighborhoods, Perry said. Ten were in majority white neighborhoods. One was in a neighborhood where the majority of residents were either black, Latino or other nonwhites.
Perry said 81 percent of the bank-owned properties in black or nonwhite neighborhoods were blighted by trash, while 30 percent of such homes in white neighborhoods were similarly afflicted.
Fifteen or more maintenance or marketing deficiencies were found at 25 percent of bank-owned homes in black or nonwhite neighborhoods, Perry said.
No homes had that many problems in white neighborhoods.
Perry displayed pictures of well-maintained homes in Baton Rouge’s black neighborhoods that sandwiched empty bank-owned homes that were eyesores.
“The neighbors are working hard,” Perry said. “All we’re asking is that U.S. Bank do the same: Be a good neighbor.”
Nicole Garrison-Sprenger, U.S. Bancorp’s vice president for corporate public relations in Minneapolis, said in an email: “U.S. Bank has been fully cooperative with the NFHA since they announced their claims in April 2012. We share NFHA’s concerns about abandoned and neglected properties, and we fully support efforts to maintain the integrity of our communities.”
Garrison-Sprenger continued, “Unfortunately, NFHA’s claims against U.S. Bank have been inaccurate. U.S. Bank is one of the nation’s leading corporate trustees, which is important in this matter because it means we have no legal right to service or maintain properties that are held in an investment pool for which we are trustee.”
Most nontrustee houses identified by NFHA have been “transferred to HUD, which requires maintenance to HUD standards — and approval by HUD — before they are conveyed,” Garrison-Sprenger said.
Shanna L. Smith, NFHA’s president and chief executive officer, said Tuesday from Washington, D.C.: “U.S. Bank officials continue to fall back on this: They’re just the trustee. They say they have no liability.”
U.S. Bank is not exempt from requirements of the Fair Housing Act for a lender to properly maintain foreclosed properties, Smith said.
“No one is immune from liability under the Fair Housing Act,” said Stephen Dane, an attorney for NFHA.
In Baton Rouge, Mayor-President Kip Holden declined to comment on the dispute. Holden said the NFHA complaint against U.S. Bank would need to be reviewed by attorneys for city-parish government before he could issue any statement.
State Sen. Sharon Weston Broome, D-Baton Rouge, was out of town and unavailable for comment Tuesday, a staff member said.
Broome has studied issues related to the dispute in the past.
The NFHA’s amended complaint at HUD alleges nonwhite residents of Baton Rouge and the other 23 named cities “have been subjected to deteriorating and dilapidated living conditions in their neighborhoods; denied opportunities for neighborhood stabilization and economic recovery; and harmed in their home investments” by U.S. Bank’s policies.
Perry, of the New Orleans nonprofit working in Baton Rouge, said U.S. Bank’s homes in nonwhite neighborhoods lack for-sale signs.
“No one even knows that this property is available,” Perry added. “The trash gathers everywhere.”
Perry said 63 percent of U.S. Bank’s residential properties in black or other nonwhite neighborhoods in Baton Rouge have damaged siding.
He said only 20 percent of the bank’s properties in white neighborhoods exhibit such damage.
Both Smith and Perry said such problems decrease the property values of neighboring homes owned and diligently maintained by black and other nonwhite residents.
Added Perry: “These are communities where families have pride in their homes.”